Should Ontario Charities Provide Legal Services?

The legal profession, like the law itself, is slow to change. However, facing growing economic pressure and competition, lawyers and paralegals have had to look for new ways to keep themselves afloat. After all, law isn’t just a calling – it’s a business.

At the same time, the Law Society and the profession as a whole has increasingly turned an ear to the plights of people who cannot access the legal services they need. The traditional ways of delivering legal services fall short when it comes to access to justice.

These two issues have put pressure on the Law Society to open up new avenues for lawyers and paralegals to deliver their services to the public.

Permitted Business Structures for Lawyers and Paralegals in Ontario

Right now, licensees are fairly limited in how they can provide services. They can practice or provide services as sole proprietors, in a general partnership, a limited liability partnership (a structure also available to professionals like dentists, doctors, etc.), or a professional corporation.

They can also enlist the services of other professionals, like accountants, and deliver blended services in a multi-discipline practice or affiliate relationship.

For the most part, these restrictions are understandable. It’s important that lawyers and paralegals can’t hide behind a corporation to avoid consequences. Multi-discipline practices make a lot of sense in certain areas of law. The partnership arrangement is well ingrained in the legal profession, with the classic steps of a successful legal career still being student > associate > partner for many people.

There are a lot of limitations that restrict how legal professionals do business – how to take on clients, how to manage finances, who can be a part of the business,. Again, there are good reasons for this. The rules help to protect the public and set good business practices. The Law Society’s mandate is to regulate the profession in the interests of the public, not in the interests of licensees making money.

But at a time where fewer people can afford legal services, and more licensees are having trouble making a living, people are looking for new ways to do business.

Alternative Business Structures

The Law Society has been looking into the idea of allowing new forms of business for some time now. It formed a working group way back in 2012, which released its first discussion paper in 2014 and a further report in 2015.

The working group studied the potential for new business forms to speed innovation in the slow-moving profession and enhance access to justice. Some of the ideas tossed around were allowing non-licensees to have an ownership stake in firms, franchise arrangements, and the delivery of legal services by civil organizations like charities.

Providing Legal Services Through a Charity

In the end, it’s the latter idea that’s made the most headway. In September 2017 Convocation, the Law Society benchers voted to approve, in principle, a policy to allow lawyers and paralegals to provide legal services through charities and non-profits. The main points:

This new form of regulation would not include organizations funded by Legal Aid Ontario.

It won’t impact the existing provision of legal services.

The regulations would cover services provided at no cost to the client.

The charities will not be allowed to refer clients to lawyers or paralegals in exchange for donations, payments, or other forms of consideration.

This could open up new avenues that could benefits licensees and the public both. Charities focused on social justice issues could have staff lawyers and paralegals that provide services through the charity itself, rather than on a referral basis.

The idea has promise, but at this point, it’s still just that – an idea. The Law Society hasn’t taken concrete steps to implement this.